Source: http://www.imf.org. Despite their fiscal burden, the public pension system of BRO countries are failing to provide adequate social protection. Although there is a broad consensus about the need for pension reforms, BRO countries are debuting whether to embark on systemic reforms or whether to correct the distortions in their pay-as you-go (PAYG) pension system. The paper reviews the measures taken by BRO countries during the transition period to address their pension problems and examines the options for future reform. It makes a strong case for a gradual reform approach aimed at establishing a multi-pillar system over the long run, but initially focused on implementation of "high qulity" reform of the PAYG system.

Source: http://www.worldbank.orgThe following paper outlines and summarizes the Bank’s current thinking on pension reform, but does not constitute the Bank’s formal position in this area. A paper on "Main Issues of Bank-guided Pension Reforms" will be prepared by my group for discussion at a meeting of the Board of Executive Directors of the Bank, scheduled for Summer 1998. The current paper, therefore, should be understood as a first outline open to discussions and revisions. The paper profited from the comments and suggestions of David Lindeman, Robert Palacios and Steen Jorgensen (HDDSP).

Source: http://www.econ.bbk.ac.uk/pi.Social security is increasingly debated in terms of alleged effects of public pensions on economic efficiency. The author reviews the history and rationale for public provision of retirement income, then argues that the efficiency effects of such schemes are negligible. Social security reform in itself is not likely to generate increased savings or growth; it is essentially a zero sum game in which some participants gain at the expense of others. Arguments for reform of social security masquerade as economics, while in reality they are political arguments for changing the distribution of costs and benefits.

Three billion people around the world live on less than US$2 a day. These people primarily live in Africa and Asia. The poverty of these people should be a concern to the global community. They typically rely on family arrangements to provide income when they are unable to work due to disability or old age. A complex retirement income system would not be appropriate to meet their needs. Where possible a system that transfers income to them in old age from fellow citizens with higher income would be desirable.

Source: http://www.imf.org. This paper outlines some of the arguments for and against the funding of public pensions, with a view to establishing whether there is an economic basis for judging funding to be superior to pay-as-you-go (PAYG). It is argued that funding does not have a clear advantage, and the case for a shift from PAYG to funding is to thus an ubeasy one. There is nonetheless growing advocacy of funded public pensions as part of an ideal pension system, whoch raises more general issues aboute the role of public sector in pension provision.

Source: http://www.imf.org. This paper argues that there are significant risks, limitations, and complications associated with reliance upon mandatory DC, fully funded scheme as the dominant public pension pillar. Policies to limit risks may result in the government being reinjected into playing an important financial role in provision of social insurance. For many countries, the principal source of old age support should thus derive from well-formulated, public DB pillar, with significant amount of prefunding. A DC/DB pillar can play a useful supplemental role in a multi-pillar system for accumulation of pension savings.

Source: http://www.worldbank.org. This paper starts by summarizing the major findings and recommendations in Averting the Old Age Crisis, regarding problems of traditional pension systems and proposals for reform. It then proceeds to describe how these reforms are now being implemented in many countries and examines empirical evidence on the growth impact of pension reform. Studies that have been done thus far on the basis of limited available data, most of them from Chile, indicate that the impact on national saving and financial market development, and through these on economic growth, has been positive and possibly large.

This paper outlines the regulatory framework within which occupational defined benefit pension plansare financed and addresses the challenges facing the funding of such plans. The Appendices include asummary and discussion of the funding regulations in twelve OECD countries plus Brazil – all of whichhave a long history of DB plans. The paper draws on these experiences in these countries and developsrecommendations for the future regulation of pension plan funding in OECD countries and elsewhere.The paper addresses such central issues as the types of funding and actuarial costing methods thatcould be considered as best practice. It identifies the challenges facing regulatory authority in establishingappropriate minimum funding requirements and maximum funding limitations. In particular, the paperanalyses the different approaches taken by various regulators in light of the problems experienced by plansponsors since the early years of the 21st century. Finally, the paper addresses the sometimes uneven risksharing of funding shortfalls and funding excesses (surpluses) between plan sponsors and plan members.All of these issues still are being actively debated, and regulations already are being changed.JEL codes: G18, G23, J32Keywords: regulation; pension fund; defined benefit plan; occupational pension plan; fundingrequirements; actuarial costing methods.

The issue of pension benefit security has returned to the foreground of both economic and politicaldebate in many OECD countries - following high profile losses of pension benefits due to plan sponsorsbecoming bankrupt and leaving underfunded pension schemes. Some countries have dealt with pensionbenefit protection via strong funding rules (the route taken for example by the Dutch authorities). TwoOECD papers examine other methods for increasing benefit security in retirement – via pension benefitguarantee schemes (such as the Pension Protection Fund recently introduced in the UK) and the position ofpension creditors within insolvency proceedings (which has been examined, for example, in Canada).Pension Benefit Guarantee Schemes are insurance type arrangements - with premiums paid bypension funds - which take on outstanding obligations which cannot be met by the insolvent plan sponsors.JEL codes: G23 J32Keywords: pension benefit, guarantee schemes, insolvency insurance, bankrupt, underfunded, pensionscheme, funding rules, PBGC, PPF.

This paper is thus of a consultative nature. We hope that it is the beginning of a widerdebate between social security stakeholders, researchers, practitioners and decision-makersas to how to provide some form of social security to the majority of the world’spopulations and to ensure that the human right to social security (article 22 of the UnitedNations Declaration of Human Rights) can be made a reality in the shortest possible time.In the course of that debate we shall almost certainly have to modify our views, but wehope that the basic approach that underpins our thinking – i.e. a rights-based approach thatadvocates universal access to social security – is flexible and open enough to achieve awide consensus on the two central objectives of social security: poverty alleviation and thegranting to all people of the opportunity to live their lives in the absence of debilitatingmaterial insecurity.www.ilo.org

This paper examines how uncertainty regarding future mortality and life expectancy outcomes, i.e.longevity risk, affects employer-provided defined benefit (DB) private pension plans liabilities. The paperargues that to assess uncertainty and associated risks adequately, a stochastic approach to model mortalityand life expectancy is preferable because it permits to attach probabilities to different forecasts. In thisregard, the paper provides the results of estimating the Lee-Carter model for several OECD countries.Furthermore, it conveys the uncertainty surrounding future mortality and life expectancy outcomes bymeans of Monte-Carlo simulations of the Lee-Carter model.In order to assess the impact of longevity risk on employer-provided DB pension plans, the paper examinesthe different approaches that private pension plans follow in practice when incorporating longevity risk intheir actuarial calculations. Unfortunately, most pension funds do not fully account for futureimprovements in mortality and life expectancy. The paper then presents estimations of the range ofincrease in the net present value of annuity payments for a theoretical DB pension fund. Finally, the paperdiscusses several policy issues on how to deal with longevity risk emphasizing the need for a commonapproach.JEL codes: J11, J26, J32, G23, C15, C32Keywords: Demographic forecast; mortality and life expectancy; life tables; longevity risk, retirement;private pensions; defined-benefit pension plans; Lee-Carter models; Monte Carlo methods, histograms.